U.S. OFFICE OF SPECIAL COUNSEL TRANSMITS REPORT
SUBSTANTIATING WHISTLEBLOWER’S ALLEGATIONS OF VIOLATIONS OF THE ANTI-DEFICIENCY ACT AND OTHER FEDERAL LAWS
AT THE NATIONAL CAPITAL PLANNING COMMISSION, WASHINGTON, D.C.
FOR IMMEDIATE RELEASE - 6/20/02
CONTACT: JANE MCFARLAND
The U.S. Office of Special Counsel (OSC) yesterday transmitted to President Bush and the Congress, an investigative report substantiating allegations that between 1997 and 1999, an official of the National Capital Planning Commission (NCPC) committed violations of the Anti-Deficiency Act, the federal printing statute, and regulations governing the misuse of federal property. The investigation was conducted after the Special Counsel concluded that there was a substantial likelihood that information provided to OSC by Ms. Cindy L. Snyder, a former NCPC Administrative Assistant for Budget and Accounting, disclosed violations of law, rule or regulation by NCPC’s Chief Operating Officer. By law, where the Special Counsel makes such a substantial likelihood determination with respect to a whistleblower’s disclosures, the agency involved, in this case NCPC, is required to conduct an investigation of the disclosures and report its findings and any planned corrective and/or disciplinary actions to the Special Counsel.
In her letter to the President and Congress transmitting the investigative report in this matter, the Special Counsel noted that she had made a statutory determination that the investigative findings and the corrective actions taken by NCPC appear reasonable, with one exception. Specifically, she concluded that the disciplinary action NCPC took against its Chief Operating Officer (a 15-day suspension), and the manner in which that disciplinary action was imposed, to be served in five three-day increments that included weekends, did not appear reasonable, given the misconduct the report identified.
After OSC concluded that an investigation originally conducted by NCPC itself was statutorily deficient, NCPC requested that investigative reports be prepared by the Office of Inspector General, General Services Administration (GSA) and a consulting firm, Clifton, Gunderson, L.L.P. The reports found four violations of the federal Anti-Deficiency Act. The Clifton report concluded generally that NCPC lacked effective controls over budget execution and financial reporting, which led to mismanagement of funds.
First, the reports concluded that NCPC unlawfully charged $153,187 in fiscal year (FY) 1997 payroll expenditures to FY 1998. The Anti-Deficiency Act requires, among other things, that payroll charges be paid out of funds for the fiscal year in which they were incurred. According to the reports, by signed memorandum, the Chief Operating Officer initiated the transfer of payroll charges in December of 1997 because the Treasury Department’s records for NCPC showed a negative closing balance of $138,023.87 for FY 1997. The Clifton report concluded that the Chief Operating Officer was responsible for this violation and that she should have known before December of 1997, on the basis of status of funds reports, that the potential existed for payroll expenditures to exceed budget. The GSA IG similarly concluded that “closer monitoring of spending, and budgeting of payroll costs for the entire fiscal year could have prevented this situation from occurring.”
Second, the GSA IG confirmed that during FY 1998, NCPC had charged large sums of money, totaling $832,021.99, to prior years accounts dating back to FY 1992. NCPC advised GSA that it could not provide the supporting documentation for the vast majority of these expenditures because the relevant files were “missing.” GSA was therefore unable to determine the lawfulness of over $800,000 in FY 1997 NCPC expenditures being charged to prior fiscal years. Clifton Gunderson similarly was unable to make any determinations with respect to the majority of these funds. Based upon the documentation provided, the report concluded that $69,295 charged to FY 1992 should have been charged to FY 1996 in violation of the Anti-Deficiency Act. No determination could be made as to who was responsible for that violation.
The third Anti-Deficiency Act allegation involved an NCPC Indefinite Delivery Indefinite Quantity contract with Photo Science, Inc. NCPC spread out the cost of a $164,000 contract modification the Chief Operating Officer signed in February of 1996 by charging all but $44,170.40 to FYs 1993, 1994, and 1997, and to a project account because there were insufficient funds in FY 1996 appropriations to pay for the obligation. No determination could be made as to how the remaining $44,170.40 was charged. Although NCPC’s Chief Operating Officer stated that she believed there was documentation from the program offices to support the charges to prior fiscal years, none was ever provided. The Clifton report concluded that the documentation available supported a violation of the Anti-Deficiency Act in the amount of $55,000. It found the Chief Operating Officer responsible for this violation.
The fourth Anti-Deficiency Act allegation involved 34 purchase orders entered in FY 1997 (totaling approximately $300,000) that were obligated to FY 1998 funds. The GSA audit concluded that 28 of these purchase orders, totaling $266,407.02 of the expenditures, should have been paid with FY 1997 appropriations. The report states that NCPC took intentional actions to deobligate funds and charge FY 1997 expenditures to FY 1998 appropriations. Due to the absence of supporting documentation, no conclusion could be reached regarding the remaining six purchase orders. The Clifton report also concluded that 28 of the purchase orders ($266,407) were improperly charged to FY 1998 and found the Chief Operating Officer responsible for this violation.
The report also substantiated the allegation that the Chief Operating Officer had misused her government telephone card by frequently making personal telephone calls and charging them to the government in violation of 41 C.F.R. § 101-35.201. The Chief Operating Officer reimbursed the government in the amount of $316.50 for the unauthorized calls.
The report also substantiated the allegation that on approximately 16 occasions between October 1997 and 1999, the NCPC violated the federal printing statute, 44 U.S.C. § 501, by procuring printing services from private vendors using appropriated funds, rather than procuring them from the Government Printing Office. The amounts paid for private printing services ranged from $211 to $184,185. The report concludes that a violation of 44 U.S.C. § 501 occurred and that the Chief Operating Officer and two other NCPC employees who signed purchase orders authorizing the procurement of printing services from private vendors were the responsible officials.
In response to these findings NCPC has taken a number of corrective actions. The current Chairman, the Honorable John V. Cogbill, III, notified the President and Congress of the violations of the Anti-Deficiency Act pursuant to 31 U.S.C. § 1351. He also took a number of steps to improve financial and budgetary accountability at the agency. In addition, new procedures were implemented to ensure that the procurement of printing services complies with the law.
NCPC also suspended the Chief Operating Officer “from duty and pay for fifteen calendar days” for misconduct in connection with these violations. Under regulations issued by the Office of Personnel Management, this is the minimum period of time that an agency may choose to suspend a member of the Senior Executive Service for misconduct. NCPC chose to impose the suspension in three-day increments over five weekends, including Friday, Saturday and Sunday. It advised OSC that it imposed the suspension incrementally because the Chief Operating Officer filled a position that was critical to the agency’s mission and that a prolonged absence would adversely affect agency operations.
The Special Counsel concluded that the corrective actions NCPC had taken to improve financial controls at the agency appeared reasonable. She found, however, that the 15-day suspension NCPC imposed upon its Chief Operating Officer appeared
unusually lenient in light of her position of public trust and the misconduct substantiated, including several instances where crucial financial records were missing with no clear explanation. In addition, the Special Counsel noted that NCPC’s decision to impose the suspension in three-day increments, including weekends, further weakened the penalty, making it the equivalent of a five-day suspension without pay. The Special Counsel found that NCPC’s explanation for its action—that the Chief Operating Officer was so critical to the mission of the agency it was necessary to minimize her absence from the office to the greatest extent possible—was not credible in light of the fact that it had granted her 136 hours of annual leave since November of 2001, when it imposed the suspension. Indeed, she observed that the Chief Operating Officer was granted annual leave during two of the pay periods when she served her suspension; in one of those pay periods she had been granted 48 hours of annual leave.
Finally, the Special Counsel noted that the Chief Operating Officer continues in her position and has significant authority over NCPC’s financial management. Given the misconduct and mismanagement that occurred under her stewardship, the Special Counsel concluded that NCPC’s decision to maintain her in her position does not appear reasonable.
Among its other functions, the Office of Special Counsel provides federal employees with a secure channel for blowing the whistle on violations of law, rule or regulation, gross mismanagement, gross waste of funds, an abuse of authority, or a substantial and specific danger to public health and safety. The OSC requires agencies to conduct investigations whenever it finds a substantial likelihood that a federal employee’s disclosures demonstrate the existence of one of these conditions. The agency must then report its findings as well as any corrective action taken to the OSC. After the OSC reviews the report to ensure that it contains the necessary information and that its findings appear reasonable, the OSC transmits the report to the President and the Congress for further action, if appropriate.
Copies of the NCPC’s report, Ms. Snyder’s comments, and Special Counsel Elaine Kaplan’s transmittal letter can be obtained by contacting the OSC.